Zentiva’s sales in Romania down 22%

“In Romania, our financial performance suffered due to our efforts to improve cash inflow and reduce arrears within the distribution system, to position our business in such a way as to have the highest sales and profits in 2008,” declared Jiri Michal, President and CEO of Zentiva.

The evolution of sales reflects a change in strategy in 2007, with the company putting emphasis on improving the management of its working capital, improved cash inflow and stock management. These changes led to a drop in deliveries in the second half of 2007. While annual sales dropped in 2007 year-on-year, sales in Q4 were higher than in Q4 2006. Nevertheless, in Q4 2007, Zentiva posted sales on the local market worth RON 53 mln (€15.3 mln), 41.3 percent lower than the RON 90 mln (€25.5 mln) posted in Q4 2006. The decline of sales in Romania impacted negatively on the entire group’s profitability.

Net profit in 2007 of the Zentiva Bucuresti drug producer dropped last year 5.4-fold, to RON 4.25 mln (€1.2 mln), from RON 23 mln year-on-year. Results include only the evolution of locally-produced drugs, and not those imported from other factories of the Czech Zentiva group, majority shareholder of the Romanian company. Total income of the producer amounted to RON 210.25 mln (€63 mln), down 35 percent year-on-year, when total expenditures dropped 29.1 percent, to RON 201.23 mln (€60 mln).

The Romanian production unit is listed on the Bucharest Stock Exchange (BVB).